The sounds of winter echo through the spiral hallways of genetic memory. It sounds like tn-tn-tn, the sound of a squirrel scurrying across the tree branch unmuffled by the rustling leaves. It sounds like ssuh—ssuh—ssuh, a pony pushing through knee-high snow. It sounds like tsee…tsee…tsee, the distant, solitary, fading bird. And it sounds like the wail of a filly, hungry, and cold, but mostly hungry….

It has been a thousand years since a pony has felt the fear and pain of winter from outside their skin. Princess Celestia does her job pretty well. But the memories of Winter Wrap Up remain.

Memories change, or perhaps are constantly reinvented. Maybe once a long time ago during winter or just before it ponies scavenged what remnants of spring they could and took them inside their caves. Maybe they gathered around these tokens with their families because there is something about being around other ponies who are also alive that does something for a pony’s health. Maybe they even exchanged gifts, whatever paltry things they could muster, even though gift-giving is terribly inefficient. It was proof that no matter how cold things were on the outside, here in the cave among the embers and scraps of greenery, friendship lived.

Now the festival has become…merry. Ponyville lights up on Winter Wrap Up. There is even a song, sung by caroling fillies who travel door to door. Outside. In the snow.

Winter Wrap Up did not lose its meaning. But as the generations of ponies piled up like the layers of a Winter Wrap Up tree, so did new meanings blanket the old like sheets of snow covering the ground. But underneath the fun and games of the modern incarnation of the holiday, the old meanings and the ancient fears still found ways to push to the surface like the rotting hand of an animated corpse….

Hang a wreath on your door, or you might find yourself buried under one….

Now Twilight Sparkle looks out through the window of the top floor of the Golden Oak Tree as the first snow of winter falls. Her heart feels like it is a ship in the storm, tossed and beaten by the waves, or dough in Pinkie Pie’s hoofs, restlessly squeezed and stretched. Twilight Sparkle misses her princess very much, and wonders if she will get a letter for Winter Wrap Up.

There is a knock at the door. Twilight Sparkle sighs, magics her hair into something slightly more presentable than what Rarity might optimistically call war-chic, and trots down the stairs before Pinkie Pie’s frenetic knocking can disturb the wreath hanging on the door. Spike is in the kitchen making hot chocolate with peppermint and little marshmallows. The ground floor smells of ginger and pumpkin, and a Winter Wrap Up tree, amateurishly decorated with ribbon and jangling colorful ornaments enchanted to sparkle, stands tall in the center of the room.

Twilight Sparkle opens the door. Pinkie Pie, Applejack, and Rarity are carrying squarish things wrapped in colorful paper. But there is nothing under Twilight’s Winter Wrap Up tree.

Twilight Sparkle has not gotten her friends any presents for Winter Wrap Up.

Rarity took a drink of hot chocolate, carefully sipping around the marshmallows. Spike sat on the arm of her chair, holding his own mug with trembling claws. So far he had managed a “gnngh” and two “huh huhs” in response to Rarity’s chatter. A true lady, Rarity had only kind words for the hot chocolate he made and the smell of the ginger cookies fresh out of the oven.

Pinkie Pie was still giggling as she jostles the sparkling tree, the ornaments clinking gently. Applejack was wondering if anypony will mind if she polishes off the last couple of cookies.

Twilight Sparkle was girding her loins for battle, rehearsing a lecture in her head. Finally it happened.

“I’m bored,” Pinkie Pie announced. “Hey, let’s open presents!”

Twilight sat still while her friends begin parceling out their gifts. Rarity hoofed something to Applejack, Applejack hoofed something to Rarity, and Pinkie Pie hoofed something to Twilight, who took it awkwardly and set it down.

When all the gifts were distributed, Rarity suggested that everypony open a gift at the same time. Twilight Sparkle realized that this is her only chance, and she played her best card at once.

“Giving gifts is inefficient,” she said. “Winter Wrap Up is the source of so much deadweight loss every year.”

Her friends stared at her.

“Twilight,” Applejack said in a voice she normally reserved for Apple Bloom when she e.g. has just tried to do her chores faster by treating a plow as a broom with a wider spread, “what in tarnation are you talking about?”

Twilight explained. “Suppose you get robbed and lose five bits. That’s bad for you, but it’s not a net loss for the economy as a whole because your thief is now five bits richer. So why is theft bad? Because there are other losses caused by theft that don’t necessarily make anypony else equally better off. Theft makes some ponies afraid without making others braver. It forces ponies to spend bits on fences, locks, and police rather than the things they would rather buy if they didn’t have to worry about theft. That loss from being forced to spend on security rather than other things isn’t made up for elsewhere.”

“The police and, uh, fence makers and so on make more money,” Applejack objected.

“But the money would have been spent on other things,” Twilight said quickly. “All the money spent on security is money not spent on other things, so those ponies lose by the same amount the police and fence makers gain. And since the theft victim herself isn’t as satisfied by her purchases, there is a loss to one pony that isn’t made up by a corresponding benefit to anypony else. That loss that comes with no corresponding benefit is called deadweight loss. Stealing benefits at least one pony—it does, it really does—“

“I know,” Applejack said. “I don’t think all those thieving fillies are out to make me miserable. They just like the refreshing crunch of a juicy Sweet Apple Acres apple.”

“Uh, right. So the real problem of stealing isn’t a transfer of bits from one pony to another per se—although I’m sure the victim would object to that—but the other harms imposed by stealing like fear and the shift of resources to producing security instead of things ponies would rather have if they didn’t have to spend on security. Those harms, those losses that aren’t made up for by a corresponding benefit to other ponies are called deadweight losses.”

“So stealing is bad, you say.” Pinkie Pie rubbed her chin skeptically. “What’s that got to do with Winter Wrap Up?”

Twilight answered. “Well, most of the time ponies are better at making decisions for themselves than other ponies are. You'd probably rather go grocery shopping yourself than ask another pony to do it unless you knew they would stick to a list. There are exceptions, like an adult buying for a filly who might not be sufficiently persuaded by long-term concerns, but most of the time, especially when it comes to, well, frivolities like you usually get on Winter Wrap Up, ponies would be better off buying things for themselves rather than having others guess as to what they would want.”

“But it’s nice to be treated,” Rarity said.

“It’s inefficient,” Twilight said. “The best gift is money. At best you can buy your friends what they would have bought themselves with the cash. More likely, you’ll buy something they wouldn’t have bought themselves. This creates deadweight loss because the same amount of money could have been used to create more value—that is, if ponies would just give each other money instead of presents.”

“But it’s boring always buying the same old things you already know you like,” Pinkie Pie said. “One of the best parts about Winter Wrap Up is being introduced to new things.”

“If you really wanted that you could just buy yourself something different!”

“It’s not like going shopping is free,” Applejack said. “I send Apple Bloom because it takes so long.”

“Have you ever seen a gift exchange go quickly?” Twilight countered.

Rarity sat back, seeming rather put out. “This all sounds absurd. Giving presents on Winter Wrap Up is a tradition, and it’s fun. I don’t see what efficiency has to do with it.”

“Efficiency is what powers your Elements of Equilibrium,” Twilight said. “If we’re being inefficient, then that means we’re just destroying value. Value is the stuff ponies care about. If we’re destroying value, we’re destroying the things we care about. That’s why efficiency matters.”

“So did you get us money?”

“What?”

“Did you get us money?” Pinkie Pie repeated. “I mean, it’s only logical. We all get each other presents on Winter Wrap Up. Since you said money is the best gift, that means you got all of us money, right?”

Twilight recovered quickly. “But if we all did the right thing, we’d all just end up giving each other money. You’d give away as much money as you got and it would all be a big waste of time.”

“So out of concern for the welfare of all of ponydom you didn’t get us any presents is what you’re saying,” Applejack said.

“Um, yes, well. Yes.”

“Hm.” Rarity took a sip of hot chocolate. The room seemed about twenty degrees colder.

“It’s only rational,” Twilight explained.

Applejack finished off the last of the cookies. There was an edge to the way she chewd.

“You can still all share your presents with each other,” Twilight added.

Pinkie Pie gave the tree another shake, a troubled look on her face.

“I mean, it’s not my fault you all celebrate this holiday with an irrational and economically harmful tradition,” Twilight clarified.

“You’re a jerk,” Applejack said.

“It’s a stupid holiday, and presents are for fillies! I—”

Spike burped; green flame roared out of his mouth, not nearly loud enough to muffle Rarity’s scream. Setting his hot chocolate down, he grabbed the letter that came out with the flame and looked at it.

“It’s from Princess—”

Twilight magically yanked the letter out of his grip. She levitated it to herself, opened the envelope, unfolded the letter…her eyes flitted left to right and then down and left and right. Only Spike, who had spent a fair amount of his life watching Twilight read, recognized when she went back to the top and started rereading.

“Did she wish you a happy Winter Wrap Up?” he said.

Twilight’s horn glowed again. She and the letter vanished in a flash of lavender light.

“Quite rude, really,” Rarity said.

Spike slid off the chair onto the floor. “I’ll just go check on her.”

Twilight was in her room, pacing back and forth. She jumped when Spike opened the door. He walked in, holding his tail still to express uncertainty, a lizard display often lost on ponies, including Twilight. Even Spike didn’t know why he held his tail still like that, only that it was frightening not to.

“Are you okay?” he asked.

“I should have got them presents, Spike,” Twilight said in a worried voice. “I don’t know what I was thinking.”

Spike noticed Twilight was still holding the letter from Princess Celestia. “Maybe too much thinking was your problem to begin with.”

“I can fix this, right? I can still get them presents. Didn’t I used to do that for Shining Armor on his birthdays before I learned economics and he betrayed me utterly?”

“Don’t ask me. I wasn’t there.”

“I did. I can do this. What stores are open now?”

“On Winter Wrap Up? Only your library, I think.”

“We never close.”

“Nope. Even though no pony has checked out a book in three months.”

There was a knock at the door. Twilight jumped again.

The door opened. Pinkie Pie stuck her head in. “Hey, Twilight. Did Princess Celestia get you something awesome for Winter Wrap Up? We’re going to start sharing presents now, so come down to the tree with us.”

“I—I’m not feeling well.”

“Come down. There’s something I want you to see.”

There was something about Pinkie Pie’s tone that made Twilight hesitate. Twilight realized it would be utterly ridiculous to be more afraid of her friends than a murderous pony-eating forest. Still, it took a gentle smile and a beckoning hoof from Pinkie Pie to break Twilight free of her paralysis. She followed Pinkie Pie out the door, Spike behind them.

As they walk down the hall, Twilight found the courage to speak. “You’re not mad?”

“Furious,” Pinkie Pie said. Twilight did not flinch and was surprised by this. “You must have had the most boring Winter Wrap Up parties in Canterlot. Boy I’d like to talk to whoever planned them.”

“I should have gotten you all presents.”

“Yeah, well, for the best student of the science of friendship in Equestria you’re pretty bad at putting your theories into practice. But don’t worry, I’m the best at friendship in Ponyville, the friendliest town there is. I’ll guide you through the darkness.”

“I trust you.”

“I know.” They started down the stairs. “Have you ever heard the idea that when two ponies become friends, when they part they leave a piece of themselves with the other pony?”

“It sounds like the sort of thing ponies say about friendship,” Twilight said carefully.

“Well, since I’ve got so many friends, it’s only logical that I have all these pony pieces inside me. Pretty soon I’ll grow too big for Ponyville and morph into some kind of friendship singularity. All the friendship won’t be able to fit inside my Earth Pony body. It’ll squeeze out however it can: wings, a horn, whatever.”

Twilight frowned. “Pinkie, you don’t really think you’ll become an—“

She stopped. They were at the hoof of the stairs. Twilight saw Rarity and Applejack by the tree exchanging gifts. Pinkie Pie led her over while the two ponies tore apart the wrapping paper.

“What the—what is this?” Applejack held up a purple box with writing on it. “Rarity, what in tarnation is a Glitter Dream Starter Set, and what am I supposed to do with it?”

Rarity was levitating at leg’s length a quadruple of garish yellow boots. “Applejack,” she said in a scandalized voice, “did you mix up the gift boots with the ones you meant to incinerate?”

“Those are perfectly good boots,” Applejack said. “They’ll keep your hoofs dry and clean of mud no matter how hard it rains.”

“What on earth would I be doing out in the rain, and what would I be doing ever in the mud?”

“Finding a place to bury this glitter doodad, I reckon.”

“I thought you might want to decorate your, ah, wheelbarrows, and, uh, what do you call those things, with the little metal claws—”

“Plows, Rarity. They’re called plows.”

“Yes, well, they’d stand out a lot more if they had some sparkle and shine to them. I won’t talk with you about paint and colors yet—”

“Paint? Colors? They’re tools, Rarity!”

“Yes, well, clearly you have no appreciation for the aesthetic side of things.” Rarity eyed the boots distastefully and set them down away from her.

“The boots’ll be too covered with mud for anypony too see how they look.” Rarity’s head jerked up sharply at that, and Applejack burst out laughing.

“Oh, very funny,” Rarity said, crossing her forelegs and looking away. Twilight caught a glimpse of a smile on her face.

“I reckon I’ll give the glitter to Apple Bloom,” Applejack said. “I know she’ll find some use for it. Thanks for the present, Rare.”

“Oh, you’re welcome. And thank you, Applejack, for the…boots.”

Both ponies smiled at each other while Twilight tried to understand what just happened.

“Why are you two happy?” she said. “Neither of you got what you wanted. The deadweight loss is practically the whole value of the presents!”

“We’ve been getting each other terrible presents for years,” Applejack said. “It’s like a tradition.”

Rarity beamed. “Only a true friend could get me something as awful as these boots.”

“But…the deadweight loss….”

“If I really wanted something I would just ask for it,” Rarity said. “You can always be honest with a friend like Applejack.”

“Sharing gifts with Rarity ain’t about what we get,” Applejack said. “It’s about what it says about the special bond between us.”

Pinkie Pie laid a hoof on Twilight’s shoulder. “Anypony can give another pony ten bits for Winter Wrap Up. But there is a real decency in getting another pony a present from the heart.” Pinkie Pie giggled. “Even those ugly boots!”

“Hey now,” Applejack grumbled. “I’ve got a quadruple just like those.”

Twilight Sparkle realized something, and blurted it. “That’s why I didn’t buy you girls presents. I didn’t know what to get you all. I was afraid, and I rationalized my inaction by telling myself gift-giving is an economic crime. I’m sorry. I didn’t even get you anything, Spike.”

“That’s okay. You gave me two birthday presents last year.”

“I did? Why?”

“You thought it was my birthday twice. And you were wrong both times.”

“I’m sorry.”

“It’s okay. Two birthdays! You even got me ice cream.”

“I’m a bad friend.”

“Yup,” Applejack said. Rarity swatted her on the flank.

“It’s okay,” Twilight said. “Applejack’s honesty is a gift of its own, and one I’d willingly pay for.”

Pinkie Pie wore a big smile. Her teeth were as white as the snow and gleamed like the ornaments on the Winter Wrap Up tree. “But you did get us a gift, Twilight, one straight from the heart. I’m always happy to get an economics lecture from you, and this one was extra special. Until today I hadn’t really thought about the true meaning of Winter Wrap Up. Now I know. I can’t wait to learn more economics from you next year!”

Twilight smiled gratefully. Pinkie Pie was grinning now. “Besides, two birthdays every year?” She gave Spike a significant look, who nodded back.

“Ha ha,” Twilight said. “Very funny, you two. I’ll definitely keep track of your birthdays on my calendar now.”

“We know we can depend on you when it comes to economics, Twilight,” Applejack said. “You give us the gift of a healthy macroeconomy up at the Daughter everyday. And if the other stuff comes slower, well, that’s the pace of life in Ponyville. We ain’t going nowhere.”

“Bright minds, bright hearts,” Rarity said. “That’s, ah, specialization, I think you call it, dear. And that’s why you have friends, so they can support you where you are weakest.”

“We love you, is what we’re trying to say,” Pinkie Pie said. “We got you presents so that you’ll believe us.”

Twilight tried to answer and could not. Tears ran down her cheeks like melted frost.

Gifts were given. Twilight kept her head down as she opened each one—a makeup set from Rarity, a can of varnish from Applejack, a gift card to the Sugarcube Corner and a tee shirt that read “Funky” in colorful letters from Pinkie Pie, and a new pen from Spike—and her friends wisely said nothing. At one point Twilight levitated the shirt in front of her face and drew Spike to her. What, if anything, was said or done from behind the new tee shirt cannot be said. Then Twilight released him, and it was time to light the Memorah.

The Memorah is a symbol of the phoenix, whose light and fire outlasted the winter. It is a testament to the ponies who did not outlast the winter. And it is bright and unique, and Spike has a great deal of fun in sucking in a belly full of air and expelling a line of flame over the row of nine candles, lighting them all with a merry blaze. He also finds it a pretty good way to disgorge any backed-up letters from his stomach.

“It’s beautiful,” Rarity said. Spike tried to say, “Aw, shucks,” and “Not as beautiful as you,” at the same time and ended up with “Naw shucks as you.” Rarity seemed, however, to have momentarily gone deaf, so suddenly entranced was she by the Memorah’s flame.

“It’s great!” Pinkie Pie said. “Good job, Spikey.”

Spike rubbed the back of his head. “Why do they call it Winter Wrap Up, anyway?”

“It’s because you wrap everything up when winter begins,” Applejack said. “Granny Smith always said you work to last through the winter. If it’s winter and you still have things to do then you’re in a heap of trouble.”

“I thought it was because we wrap the tree in decorations,” Rarity said. “By the way, Twilight, I could make a suggestion or two for next year. Not that it wasn’t a courageous attempt….”

“I just assumed it was because we wrap up presents to share with each other,” Pinkie Pie said.

“It’s better than calling it ‘We’re All Going to Die,'” Twilight said. “I love you all, by the way.”

“Awww!” Pinkie Pie nudged her. “Twilight, you’re so sappy!”

There were hugs then, and Spike making faces, and there were songs and light and fire, and finally it was time to part. One by one the ponies left, all of them, even Pinkie Pie, careful not to disturb, hanging on Twilight’s door, the Winter Wrap Up wreath.

Author's Notes:

Theft is bad for other reasons too, of course.